REPORT: Investigators Are Looking Into Whether A Group Of Traders Called 'The Cartel' Rigged Currency Rates

Friday

Nov 15, 2013 at 9:01 AM

Steven Perlberg

Investigators are looking into whether a cadre of traders dubbed "the cartel" or "the bandits club" rigged currency rates, the New York Times' Ben Protess, Landon Thomas Jr., and Chad Bray report.

Earlier this month, we brought you the full explainer on how the alleged scheme works, but basically the idea is that forex traders might be colluding to tamper with a benchmark rate in order to increase their bottom line. From the Times:

The trading group called “the cartel,” or “the bandits club,” included employees from R.B.S. and UBS, people briefed on the investigation say. It is unclear when the group was operational or if it ever crossed a legal line.

The former member of the group told colleagues that individual client names weren’t discussed in the electronic chat rooms. Instead, the traders occasionally discussed positions in an effort to match buyers and sellers, according to the person briefed on the group.

Once again, the smoking gun for investigators might come down to incriminating instant messages. So it's no surprise that JP Morgan — a bank currently in the penalty box with regulators — told its employees to stop "bullshitting" over chat.

Read the full report at the New York Times »

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SEE ALSO: Here's Everything You Need To Know About The Growing Investigation Into Rigging The Global Currency Market